What is a custodian bond?
If you’re about to be appointed custodian of an individual, the court may require you to post a bond first. A custodian bond ensures that you – as the custodian or guardian of a disabled person, elderly adult, or minor – follow all rules and regulations that apply to your role. The bond guarantees that you act ethically and legally in managing a beneficiary’s assets.
What is a custodian?
In a nutshell, a custodian is either a person or an agency entrusted with protecting a client (ward or beneficiary) and their finances.
Get Your Custodian Bond:
- If you’re about to be appointed custodian of an individual, the court may require you to post a bond first.
- A custodian has the power to act on behalf of their clients, which may include making investments and payments.
- The bond guarantees that you act ethically and legally in managing a beneficiary’s assets.
- The court will set the bond amount required based on a beneficiary’s annual income and assets.
What does a custodian do?
The role of a custodian is to manage their clients’ funds and assets. The client is a ward or beneficiary. A custodian has the power to act on behalf of their clients, which may include making investments and payments. When a beneficiary is a minor, the custodian is charged with limiting that minor’s activities and may make purchases and financial contributions on their behalf. The bond ensures that the custodian performs this role ethically, legally, and in the client’s best interest.
Custodians vs. Guardians
If you’ve read our page on guardianship bonds, you may wonder how guardians differ from custodians. Guardianship and custody both take place in probate courts and often require surety bonds. While the two are very similar and often confused, there are some noteworthy differences.
- Guardianship: The court may appoint a legal guardian to care for someone (a minor, elderly adult, or disabled adult). The guardian makes decisions on behalf of this person regarding their welfare and care. Guardianship is often – though not always – more permanent than custody, which is more flexible.
- Custodian: Sometimes, the court appoints a third party (in addition to a parent or relative taking custody of someone) to manage a beneficiary’s funds and assets.
How to Get Your Custodian Bond
To get your court-ordered custodian bond, apply with a trusted surety provider licensed to work in your state, like ZipBonds. We can quickly process your bond application.
To apply, you’ll need to provide applicable court documents and information, which may include the following items:
- Copy of your court order
- List of assets
- List of estimated annual expenses
Once we’ve reviewed your application, you can pay your premium and print your bond!
Frequently Asked Questions
Often, the courts require future custodians to post custodian bonds to hold them accountable to the law and ensure they take proper care of clients and their finances.
Before the court issues custody of someone, they may require you to purchase and post a custody bond. This protects minors and incapacitated individuals from potential harm.
Like other surety bonds, a custodian bond is a three-party agreement between an obligee, a principal, and a surety.
- Obligee: The court that requires a future custodian to post a bond
- Principal: The person or business that will obtain a bond and become a custodian
- Surety: The financial institution that underwrites and issues the bond
If you break your surety bond agreement by taking advantage of your client in any way that causes them harm or costs them money, you could face costly bond claims.
The court will set the bond amount required based on a beneficiary’s annual income and assets. The court will set the bond amount. Expect to pay around 1-3% of the bond limit as your premium. Your bond requirement may change over time based on the custody arrangement.
Call ZipBonds for a quote on how much your annual premium will cost. Our number is 888-435-4191. We’d be happy to walk you through the entire bonding process from start to finish to get you bonded as quickly as possible.
Apply for a Custodian Bond in Your State
We can help you get your custodian bond in a flash! Apply online or over the phone (888-435-4191) with one of our agents, and we’ll issue your bond quickly. We offer the fastest and most secure option for getting court and probate bonds.
Founders Ryan Swalve and Zach Mefferd formed the vision for ZipBonds.com when they realized how overly complicated it was to help clients place surety. The frustration of being unable to incorporate the technology they’d used in other insurance-focused projects left them thinking “there has to be a better way.”
Fast forward a couple of years, and that better way is the impetus of everything we do at ZipBonds. We constantly look for innovative ways to improve the bonding process for our clients and agents. Our team comprises individuals who understand all angles of surety – for companies, agencies, and individuals. Incorporating everyone’s point of view to improve the process while simultaneously integrating cutting-edge technology is what sets our business apart.